SERVICE TAX APPLICABILITY ON PURE LABOUR CONTRACT, Service Tax

[Kunal Aggarwal]

Hi,

Please let me know SERVICE TAX APPLICABILITY ON PURE LABOUR CONTRACT. Individual having Wooden work on pure Labour Basis.

Posts / Replies

[Ganeshan Kalyani]

The service provider is liable to charge service tax @15% on pure Labour charges subject to availment of exemption of SSI limit.

[Mahir S]

Pure labour contracts are outside the scope of works contract as for classifying a contract to be works contract it is necessary that there should be transfer of property in goods involved in the execution of such contract which is leviable to tax as sale of goods.

[Ganeshan Kalyani]

The description on invoice should be apparently mention as 'Pure Labour charges' . Otherwise auditor attention may get invited to such transaction.